Today, cooperatives throughout the world are going through a period of seious
questioning. The capitalist model has proved, after all, not capable of ensuring
generalized prosperity for all: on the contrary, it is currently leading to a widening of the
gap between the haves (those with a job) and the have-nots (those without one). Instead
of peace and equity, there is less security, social tension, drugs, violence, massive
migration both within countries and across borders, the break-up of the family unit.

The communist model has also disappointed. Based on a philosophy built on
conditions reigning over a century ago, taken over by apparatchiks intent on pursuing
their own selfish ends, it failed as a system of government. While it did provide a high
degree of social security, this was at a high cost in terms of personal freedom and the
stifling of individual initiative and dynamism. It has left behind it economic chaos and
environmental disaster.

The South has suffered from the negative effects of one or both of these
philosophies. Traditional organisational structures and the social order they ensured have
been weakened. All-out exploitation of natural resources has, among other factors, led
to rural exodus and massive social tensions in overcrowded cities. Regrettably, the
response to these difficulties has more often been authoritarianism than dialogue.

Where is the world going?

The cooperative provides a potential means of reconciling the ideals of both
systems: it extols private enterprise and the profit motive (termed “surplus”) while, at the
same time, incorporating equity concerns and social responsibility. Moreover, it is based
on democracy, which both capitalism and communism claim as theirs. It can resituate
people at the centre of global concerns, rather than on the margin.

Two things are clear:

cooperatives have succeeded best in the West, where they have been able to develop without the constraints of excessive government bureaucracy and interference;

the strength of the cooperative model is its grassroots and local character; as cooperatives have increased in size, either through artificially conferred monopolies or amalgamation of primary societies, their special nature has become increasingly diluted and member participation has fallen.

The major immediate obstacle to a renaissance of the cooperative form of
economic and social organisation is the sullied image of the cooperative, especially in the
developing world. Many people who have been exposed to “cooperatives” in the past
three decades are intent on avoiding them, rather than embracing them, in future. If
cooperatives are to be revived and play the role which could be theirs, confidence-building
measures are urgently needed.

In the light of all the above, is it not time for an open and honest debate on what
a cooperative should be in the 21st Century? This might require further modest revisions
of the principles according to the type and level of cooperative. Perhaps the cooperative
directory needs reviewing, some societies being placed on probation, and others striken
off the list altogether. This would reduce the current confusion in many peoples' minds
about what a cooperative really is. Conversely, would it not be a sign of modernisation
and openness for the rather closed cooperative family to accept into its fold institutions
that operate like cooperatives, even if they prefer not to carry the “cooperative” label?

In North America and Europe, there is much rethinking of social values, including
the role of cooperatives20. This is generally directed towards locally-based, socially-oriented,
mutual-support actions founded on the notion of solidarity, though this still
cannot forego economic viability. Maybe those involved are the new cooperative
pioneers!

The FAO People's Participation Programme (PPP) is an innovative rural poverty programme which aims at establishing sustainable networks of rural people's organizations run by the poor themselves to improve their living conditions through self-help. Small groups of 8 – 15 members are used as the principal “building blocks” for constructing larger, more participatory and sustainable farmers' organizations, including cooperatives.

An outstanding example of the power of this approach is the Zambia PPP project set up in 1983 in the Western Province of Zambia. By 1993, in its final phase, the project was working with 240 stable groups federated into 32 inter-group associations and representing the needs of 2800 members and their families. The focus was on income generation, savings and credit, and food security.

The project had two distinctive features. One was that women were targeted as group leaders, and 73 per cent of the members were women. The other was the participatory monitoring and evaluation system, whereby participants defined what was important to them, regularly recorded and analyzed data and decided on any corrective action.

The groups were organized around their own income-generating activities which they themselves identified with the help of specially trained Group Promoters. While some emphasis was given to providing group credit facilities at later stages, the initial focus was on building the savings capacities of the groups, thus creating strong bonds and financial discipline before seeking outside help. Even though 30 percent of groups failed this consolidation test, the remaining 70 percent have since become highly motivated and able to develop autonomously.

Once consolidated, groups were encouraged to federate into Action Area Committees to enable them to command greater negotiating power in discussions with the authorities.

The results achieved have been considerable: 50 percent increase in land cultivated per family, doubling of crop income, considerable diversification of crops grown, introduction of savings, increase in paid off-farm activities by groups, and higher food security and family incomes.

Up to 1986, Zambian cooperatives enjoyed a monopoly in maize marketing. Private traders were allowed in but the National Agricultural Marketing Board continued to receive subsidies while the government controlled producer and mill prices. In 1991, liberalisation was fully implemented: the cooperatives lost their monopoly, the government withdrew from the market with the exception of partial financing of marketing and provision of information, the private sector moved in in force. The effect on cooperatives was radical as they were simply unable to compete for resources and maize.

Cooperatives took delivery at depots; private traders collected on-farm. Cooperatives paid by cheque upon approval from the head office; private traders paid cash on delivery. Cooperatives dealt only in cash; private traders could also pay in kind (fertilizer, seed, clothing…).

The cooperatives' already poor financial position was worsened by their having to pay for storage facilities and seek bank funding for maize purchases. The downward spiral had begun and today many unions have closed while most others are on the verge of collapse.